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State Name: New Jersey
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State Abbreviation: NJ
State Abbreviation Lower: nj

If you've been following the MBS Commentary, you know what a big deal this afternoon could be. Markets have been preparing for it for weeks and MBS Live members have been on top of those movements every step of the way.

This afternoon, when markets are convulsing mere milliseconds after the Fed Announcement, MBS Live members will know what's going on before anyone else. The accuracy and speed of our real-time price stream and alerts is unmatched.

The big news so far today has been the much-weaker-than-expected ISM Manufacturing data. While the headline "Purchasing Manager's Index" was still in expansionary territory at 51.3 (anything over 50 connotes expansion), this was far lower than the 56.0 forecast. It was also the biggest month-over-month drop since 1980.

While the report made some mention of recently cold weather constraining activity, that didn't stop markets from reacting forcefully. Stocks were more or less demolished, with S&Ps down more than 20 points already. 10yr yields had a pretty steep drop as well, moving from 2.67 before the data to 2.61 a few minutes later.

MBS aren't able to keep up quite that pace when it comes to these big, reactionary, risk-off movements. But the swing from negative to positive territory still brings them to their best levels since mid November. Compared to the 17/32nds gain in 10yr Treasury prices, Fannie 4.0s are up only 7/32nds and 3.5s are up 10/32nds.

MBS Pricing Snapshot

Pricing shown below is delayed, please note the timestamp at the bottom. Real time pricing is available via MBS Live.

Matthew Graham : "RTRS- DROP IN MANUFACTURING NEW ORDERS INDEX IN DECEMBER WAS LARGEST SINCE DEC 1980 "

Jeff Anderson : "I heard over the weekend today was supposed to be a decent day for equities with the 1st day of the month and funds investing and that tomorrow would be the real test to see where we may go. Ruh roh."

Matthew Graham : ""A number of comments from the panel cite adverse weather conditions as a factor negatively impacting their businesses in January, while others reflect optimism and increasing volumes in the early stages of 2014.""

David Dickens : "Are lenders pricing off the 3.5 now?"

Brian Bockholdt : "I second Davids question"

Matthew Graham : "4.375% can go either way, probably still favoring 4.0 coupons at that rate, but anything being originated at 4.25% is more likely getting slotted into 3.5 coupons. "

Matthew Graham : "3.5's are unquestionably a consideration for the lower reaches of rate sheets. As such they bear consideration along with 4.0s as far as reprice risk is concerned. At times like this, I usually set alerts for both the coupons."

Ira Selwin : "Still check out your buydowns too. Still some lenders with heavy buydowns from 4.5->4.375->4.25 and beyond."

Christopher Stevens : "IMO it's going to take a bit more buying to get a solid 4.250% "

Ira Selwin : "I'm still seeing roughly 90 bps or so to go from 4.5->4.375"

About the Author

A former originator, Matthew began writing for Mortgage News Daily in 2007, covering a wide range of topics. Seeing a need in the marketplace, his focus increasingly shifted toward relating MBS and broader financial markets for loan originators.
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